The Supreme Court recently made a significant ruling by setting aside a decree passed in a civil suit for specific performance filed in 1999 concerning an agreement to sell executed in 1986. Justices Rajesh Bindal and Vikram Nath, forming the bench, underscored the need for prompt remedial measures, emphasizing that the aggrieved party should not have waited for 13 years to file a suit for specific performance.
The case in question revolved around an agreement for the sale of three houses executed on September 24, 1986. This agreement, covering House Nos. 258, 259, and 260, was executed in favor of the predecessor-in-interest of the Respondents by the predecessor-in-interest of the Appellant. As part of the agreement, it was stipulated that the sale deed would be registered upon securing permission from the Ceiling Department. The agreed total sale consideration was Rs. 55,000, with an earnest money deposit of Rs. 5,000. The predecessor-in-interest of the respondents claimed possession of the three houses agreed to be sold.
Following this agreement, the Respondents filed a suit for specific performance of the agreement, which was decreed by the Trial Court. The First Appeal and the Second Appeal upheld the decree, thereby enforcing the agreement to sell. The defendants, dissatisfied with this decree, appealed to the Supreme Court.
The Supreme Court highlighted that House Nos. 259 and 260 had been in the possession of the Appellant and its predecessor-in-interest for a significant period. Notably, it was observed that the civil suit for enforcing the agreement, filed in July 1999, was brought forth only after the sale deed for Houses 259 and 260, in possession of the appellant, was registered on July 6, 1999. The execution of the sale deed for House No. 258, which remained in the possession of the respondent, was still pending.
The Appellant contended that no permission was required from the Ceiling Department for registering the sale deed, an argument unrefuted by the respondents’ counsel.
The Court opined, “If such permission was indeed required, and the vendors failed to take any necessary steps within a reasonable period post executing the agreement, the vendee should have taken remedial measures instead of waiting for a prolonged period of thirteen years.”
Furthermore, the Court noted the absence of permission from the ceiling department even during the registration of the sale deed for Houses 259 and 260. It expressed dissatisfaction with the Respondents’ failure to take any action, instead of waiting indefinitely.
The Court critically highlighted the inaction of the vendee for a twelve-year period, despite a significant total sale consideration of Rs. 55,000 and an earnest money deposit of Rs. 5,000. It expressed concerns regarding the delayed legal action taken by the vendee, considering the circumstances surrounding the agreement and subsequent sale deeds.
Additionally, the Court noted the testimony of the DefenseWitness, stating that no permission from the Ceiling Department had ever been applied for the property’s sale. However, the plaintiffs failed to specifically question the witness regarding the necessity of obtaining such permission.
Consequently, the Apex Court concluded that the judgments and decrees of the lower courts enforcing the agreement to sell, following a thirteen-year delay in filing the civil suit, could not be legally sustained. Accordingly, the Supreme Court set aside the decree and dismissed the suit filed by the respondents.
The case, titled Hazari Lal (Dead) Thr. LRs. V. Ramesh Kumar & Others, with Civil Appeal No. 5315 of 2010, serves as a significant legal precedent, emphasizing the importance of prompt action in seeking redressal for specific performance claims.